Pre registered cars
Discussion
I'm after a Fiat 500 for my wife, I've been to two dealers and they both tried to talk me into a pre registered car. The second dealer was trying to do me a favour and save me some money, £1000 off a 500 is a big discount but it's not the spec she wants. But the first dealer, just kept lying to me, telling me it's £1750 for leather and it's not worth it, try this pre registered instead... It's £780 for leather from fiat!
Why the push on them? I see the appeal but if they can't source the car I want, it's no good to me!
Why the push on them? I see the appeal but if they can't source the car I want, it's no good to me!
Lee540 said:
Is it because pre-registered cars are stock that the dealership actually own? Costing them money with it sat in their showroom..
I'd try and sell you anything that I owned before selling you something that I order direct from supplier.
At the cost of selling nothing at all though?I'd try and sell you anything that I owned before selling you something that I order direct from supplier.
A surprising amount of people will alter their requirements when told they can have a car now with different interior or a different colour. If they don't have the car you've got to have then it will be a factory order which means they wont get paid for a few months rather than pretty much straight away.
I didn't realise they didn't get paid till further down the line. Still seems foolish not to want to sell me a car though. If I was a dealership owner I'd want cars sold, pre reg first, new orders second.
I'll ring fiat and see if the can put me in touch with a dealer who put a lot of customer orders in!
I'll ring fiat and see if the can put me in touch with a dealer who put a lot of customer orders in!
ked when it's intended owner picked it up and rejected - now for sale with a replacement engine at 5 miles or something silly like that.OldJohnnyYen said:
I didn't realise they didn't get paid till further down the line. Still seems foolish not to want to sell me a car though. If I was a dealership owner I'd want cars sold, pre reg first, new orders second.
I'll ring fiat and see if the can put me in touch with a dealer who put a lot of customer orders in!
The dealers only get paid when you pay for the car which is why there is often a massive push at the end of a quarter.I'll ring fiat and see if the can put me in touch with a dealer who put a lot of customer orders in!
OldJohnnyYen said:
I didn't realise they didn't get paid till further down the line. Still seems foolish not to want to sell me a car though. If I was a dealership owner I'd want cars sold, pre reg first, new orders second.
I'll ring fiat and see if the can put me in touch with a dealer who put a lot of customer orders in!
New and unregistered cars at a dealer are financed, with this normally being supported by the manufacturer for something like 90 days, or until the vehicle is registered. Once it's registered it comes of their stocking plan - Fine if you've sold it to a customer, as you will have been paid by them or the finance company. Not so good if it's a pre-reg, as nobody has yet picked up the tab, and it's value is dropping, as depreciation has kicked in - The longer they hold it in stck, the less profit they makeI'll ring fiat and see if the can put me in touch with a dealer who put a lot of customer orders in!
Some good advice on pre reg here http://www.drivethedeal.com/PreReg.asp
Also try http://www.carwow.co.uk/. Bought the wife's new VW this way.
Also try http://www.carwow.co.uk/. Bought the wife's new VW this way.
Pre registering is a fact of the trade today and will be for some time I suspect.
Dealers are allocated unit registration targets based upon the size of their territory (AOPR-area of prime responsibility). The target will generally be quarterly and may contain dozens of variables in larger franchises and dealerships. Generally speaking the big money lies in achieving over target, 130% was common, but the volume bonus was often applied retrospectively to all units. Hence, sell 129.9% of target as opposed to 130% and you could lose hundred's of thousand's of ££££.
Downside with pre reg is the manufacturer often stipulates specific model mixes, funding on manufacturer credit lines is occasionally prohibited, block exemption prevented their immediate sale and they are "Your" cars from the day of registering.
The secret to successful pre registering was always to get rid quick. My experience of most bulk deals was that 50% of the pre reg cars, when sold on, made you good profits, 30-35% broke even and the remainder you suffered a loss to get clear.
From a dealers perspective then it is critical to shift pre reg before the next deal comes along and yes, it is better to take a new car deal for build than nothing, but I wanted the units on site moved first wherever possible. From a salesman's perspective these are generally easy to sell owing to often huge discounts and the commission is paid now, not 3 months hence.
nb, I am 3 years out of the trade so it may all have changed.
Dealers are allocated unit registration targets based upon the size of their territory (AOPR-area of prime responsibility). The target will generally be quarterly and may contain dozens of variables in larger franchises and dealerships. Generally speaking the big money lies in achieving over target, 130% was common, but the volume bonus was often applied retrospectively to all units. Hence, sell 129.9% of target as opposed to 130% and you could lose hundred's of thousand's of ££££.
Downside with pre reg is the manufacturer often stipulates specific model mixes, funding on manufacturer credit lines is occasionally prohibited, block exemption prevented their immediate sale and they are "Your" cars from the day of registering.
The secret to successful pre registering was always to get rid quick. My experience of most bulk deals was that 50% of the pre reg cars, when sold on, made you good profits, 30-35% broke even and the remainder you suffered a loss to get clear.
From a dealers perspective then it is critical to shift pre reg before the next deal comes along and yes, it is better to take a new car deal for build than nothing, but I wanted the units on site moved first wherever possible. From a salesman's perspective these are generally easy to sell owing to often huge discounts and the commission is paid now, not 3 months hence.
nb, I am 3 years out of the trade so it may all have changed.
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